How Do I Register for VAT with HMRC

If your business’s taxable turnover exceeds the VAT threshold, you must register for VAT with HMRC. Registering for VAT allows you to charge VAT on your sales, reclaim VAT on business expenses, and stay compliant with UK tax law. While the process is straightforward, it’s important to understand when registration is required and what information you’ll need. This article explains how to register for VAT, who needs to register, and what happens after you complete the process.

When You Must Register for VAT

You must register for VAT if your taxable turnover exceeds the current threshold of £90,000 in any 12-month period.

Taxable turnover includes all sales of goods and services that are not exempt from VAT, even if your customers are VAT-registered businesses. You must also register if:

  • You expect to exceed the threshold within the next 30 days.

  • You take over a VAT-registered business.

  • You are based outside the UK but supply goods or services in the UK.

Even if your turnover is below the threshold, you can choose to register voluntarily to reclaim VAT on business purchases and improve your company’s credibility.

Voluntary VAT Registration

Many small businesses register voluntarily before reaching the threshold. The main benefits include:

  • Reclaiming VAT on expenses such as equipment, stock, and professional fees.

  • Improving your business image when trading with larger companies.

  • Preparing early for future growth.

However, voluntary registration also means extra administrative work, as you’ll need to charge VAT, keep digital records, and submit VAT returns under Making Tax Digital (MTD) rules.

How to Register for VAT Online

Most businesses can register for VAT online through the HMRC website. The process is straightforward and usually takes less than 30 minutes if you have the right information ready.

You will need:

  • Your business name and address.

  • Your Unique Taxpayer Reference (UTR).

  • Details about your business activities.

  • Your estimated annual turnover.

  • Your bank account details.

  • Information about any associated businesses you own.

If you’re a limited company, you’ll also need your Companies House registration number.

Once you have this information, follow these steps:

  1. Go to the HMRC VAT registration page and log in with your Government Gateway ID.

  2. Choose whether you are registering as a sole trader, partnership, or company.

  3. Complete the online form, providing details of your business and turnover.

  4. Select the correct VAT accounting scheme (for example, standard, flat rate, or cash accounting).

  5. Submit your registration.

After submission, you will receive confirmation from HMRC that your application has been received.

Getting Your VAT Registration Number

Once HMRC approves your application, they will send you a VAT registration certificate. This document confirms:

  • Your VAT registration number.

  • The date of registration (known as the effective date).

  • The date from which you must start charging VAT.

You will receive your certificate either through your online account or by post. Most applications are processed within two to four weeks, although complex cases may take longer.

Your VAT number is unique to your business and must appear on all invoices and official documents.

Choosing a VAT Accounting Scheme

When registering, you must choose how you will account for VAT. The main options are:

  • Standard VAT accounting: You record VAT on invoices when issued and can reclaim VAT when invoices are received.

  • Cash accounting scheme: You only pay VAT when customers pay you and reclaim VAT when you pay suppliers.

  • Flat rate scheme: You pay a fixed percentage of your turnover to HMRC instead of calculating VAT on every transaction. This can simplify reporting for small businesses.

Your accountant can help you choose the most tax-efficient scheme for your business.

Backdating Your VAT Registration

You may need to backdate your registration if your turnover exceeded the threshold in the past but you failed to register on time.

When you register late, you must:

  • Pay VAT on all taxable sales made since the date you should have registered.

  • Submit late VAT returns for those periods.

  • Possibly pay penalties and interest, depending on how late you are.

You can reclaim VAT on eligible purchases made before registration, provided they were for business use and you still have the invoices.

After You Register for VAT

Once registered, you must comply with HMRC’s VAT obligations, which include:

  • Charging VAT on your taxable sales.

  • Issuing VAT invoices to customers.

  • Submitting VAT returns, usually every quarter.

  • Paying VAT owed to HMRC by the due date.

  • Keeping digital VAT records under Making Tax Digital rules.

You can also reclaim VAT on most business-related purchases and expenses, provided you have valid VAT invoices.

Record Keeping and VAT Returns

Good record keeping is essential for VAT compliance. You must maintain digital records of:

  • Sales and purchase invoices.

  • VAT amounts charged and reclaimed.

  • Credit notes and adjustments.

  • VAT return submissions and payment confirmations.

Most businesses use MTD-compliant accounting software such as QuickBooks, Xero, or Sage to record VAT transactions and submit returns directly to HMRC.

What Happens If You Do Not Register

If your turnover exceeds the VAT threshold and you fail to register, HMRC can:

  • Charge you for the VAT you should have collected.

  • Apply penalties and interest on the unpaid amounts.

  • Backdate your registration to the date you became liable.

Penalties increase depending on how long you delay registration and whether HMRC considers the failure deliberate or careless.

How an Accountant Can Help

Registering for VAT correctly and choosing the right scheme can save both time and money. An accountant can:

  • Determine whether you need to register or if voluntary registration is beneficial.

  • Handle the registration process with HMRC.

  • Advise on which VAT scheme best suits your business.

  • Set up compliant accounting software.

  • Ensure you meet deadlines and avoid penalties.

Having professional support gives you peace of mind that your VAT registration and returns are managed accurately.

Summary

Registering for VAT is a key step for growing businesses once their taxable turnover exceeds £90,000 or if they choose to register voluntarily. You can register online through HMRC by providing details about your business and selecting the appropriate VAT scheme.

Once registered, you must start charging VAT, file quarterly returns, and keep digital records under Making Tax Digital. Working with an accountant ensures you remain compliant, avoid costly mistakes, and make the most of VAT recovery opportunities.